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U.S. Appeals to WTO Panel
On Canadian Wheat Dispute

WASHINGTON -- The U.S. Trade Representative's office said it is asking a World Trade Organization panel to consider whether the Canadian Wheat Board subsidizes Canadian farmers.

The WTO panel also would consider U.S. charges that Canada unfairly segregates imported wheat in grain handling and discriminates against imports on its rail transport system, which U.S. farmers say provides subsidized rates to Canadian suppliers, the U.S. trade agency said.

A Canadian government spokesman said Canada would "vigorously defend" its interests at the WTO. "We believe that our wheat-sector policies have been in compliance with Canada's obligations under international law," said Sameer Ahmed, a spokesman for Canada's Department of Foreign Affairs and International Trade.

Since the U.S. trade office signaled in December its plans to seek WTO arbitration, U.S. and Canadian officials have failed to resolve the dispute in bilateral talks. U.S. farmers have long complained of the wheat board's monopoly position in western Canada. The U.S. has investigated the board on nine previous occasions and found no evidence of unfair practices.

Thursday's appeal to the WTO panel follows the U.S. Commerce Department's decision Tuesday to impose preliminary countervailing duties averaging 3.94% on imports of Canadian hard red spring and durum wheat.

Spring wheat is used to make bread, and durum is used to make pasta. The Commerce Department is scheduled to decide in May whether to also impose preliminary antidumping duties on shipments of Canadian wheat.